As the saying goes, “the more things change, the more they stay the same” and that’s certainly been the case this year. It feels like it’s been a big one, with many major global events and some serious tests for treasury. And yet, looking back on the article we published the same time last year, it’s interesting to note how many of the themes from 2024 are looking likely to carry over into 2025.
Even so, there are subtle changes, and it’s the understanding and management of those fine margins that can mean the difference between getting a step ahead of the competition, or falling a step behind.
Treasury leaders are looking to 2025 with the need to deal with shifting interest rates, geopolitical tensions, and the continued adoption of technology like artificial intelligence. While these challenges may seem daunting, the good news is that treasury teams are better equipped than ever before to respond and thrive in a dynamic environment.
In this article, we’ll discuss the biggest challenges, trends, and opportunities for 2025 and how treasurers can leverage innovative technology to unlock growth and manage risk.
Challenges
US-China relations
While 2024 was marked by interest rate plateaus in most major economies, many central banks, including the Fed, commenced rate cuts in the latter part of the year. But this doesn’t mean rates are going to drop significantly in the short term.
Even after the previous two rate cuts, the Fed is still keeping them significantly higher than they have been in recent years. At the most recent Federal Open Market Committee (FOMC) meeting, with Chair Jerome Powell stating that, “The economy is not sending any signals that we need to be in a hurry to lower rates. Ultimately, the path of the policy rate will depend on how the incoming data and the economic outlook evolve.”
For treasury teams, this means continued pressure on the cost of debt. On the plus side, elevated interest rates also offer opportunities to generate returns on cash reserves, provided liquidity is managed effectively. Scenario modeling and proactive hedging strategies will remain critical to mitigating risk and optimizing working capital.
Supply chain volatility and nearshoring trends
Geopolitical instability and the aftershocks of the pandemic have accelerated the shift from globalization to regional supply chains. We all remember how tangled they got in 2020, and it has led many companies to review their reliance on overseas vendors.
In 2025, treasurers must adapt to increased nearshoring efforts in North America, Europe, and Asia-Pacific. While this shift can reduce dependency on fragile trade routes, it may also lead to higher operational costs. Treasurers need real-time data to evaluate the financial impact of these strategies.
Climate-driven risks and ESG pressures
This is another trend which has been on the agenda for many years, and it will continue to be a challenge for treasurers for many more years to come. 2025 is expected to bring with it an amplified focus on ESG transparency.
Businesses must address both physical risks and reputational risks tied to ESG performance. Treasury teams will need to balance sustainable financing with cash optimization while ensuring ESG metrics are robust and auditable.
Rising geopolitical tensions
The rivalry between the U.S. and China has deepened, with escalating trade restrictions and currency pressures. With Donald Trump talking tough on tariffs and other protectionist measures, we could see these tensions escalate further through 2025.
Emerging markets face challenges from debt distress and unstable political landscapes, ratcheting up the pressure for companies operating in these regions. For treasurers, flexibility in forecasting and a diversified approach to investments will be essential for navigating these uncertainties.
Regulatory overhauls in tax and reporting
2025 is expected to bring significant regulatory changes, particularly in relation to AI, cyber security and financial crime. KPMG have gone as far as to dub 2025 the Year of Regulatory Shift. Catchy.
New standards from the EU and the SEC could increase compliance burdens, requiring treasury teams to adopt sophisticated systems to streamline reporting and avoid penalties. In order to meet these obligations without placing too significant a burden on internal resources, treasury and finance need to focus on automation to cut down on manual workflows.
Digital transformation by competitors
Digital transformation has been talked about for years now. Even so, there are many companies who have been reluctant to embrace it. While the transition period has meant a limit to how big of an impact this has had on those lagging behind, in 2025 we expect to see the investment into these tech integrations pay off in increasing numbers.
Treasurers play a crucial role in strenWhat does that mean for those who haven’t invested in digital transformation? They’re at risk of falling behind. KPMG’s 2024 GenAI survey showed that 78% of executives expect to see ROI on their investments within 1 to 3 years, which should serve as notice for those yet to prioritize it.
gthening the resilience of multinational corporations in the prevailing environment of geopolitical uncertainty.
Trends & Opportunities
Automation
Artificial intelligence has moved beyond hype to become an indispensable tool for treasury. From anomaly detection in cash flow forecasting to automated reconciliation and chatbot-powered queries, AI is driving efficiencies at every level.
For large multinational companies, seemingly small efficiency gains through a reduction in manual workflows can add up to huge savings. For smaller companies and startups, it can mean the ability to scale more efficiently and cut down burn rate.
AI interfaces like Trovata AI allow treasurers to interrogate their financial data like never before, For example, by using natural language questions like, “What caused the $10M variance in last quarter’s AP balance?” and receive actionable insights instantly.
Predictive analytics
The extension of AI and automation is predictive analytics. Where automation helps gather and normalize historical data, predictive analytics powered by machine learning uses these historical numbers to forecast what might happen in the future.
It’s an opportunity which is transforming cash forecasting. Instead of relying on historical data alone, treasurers can now simulate multiple economic scenarios and predict cash needs weeks or months in advance. This capability will become critical in 2025 as economic conditions remain fluid.
Strategic treasury
The key to digital transformation is not just about being able to do the same work, faster. Enhanced insights offered through the use of tools like AI, automation allowing for maximal data gathering, and sophisticated reporting and forecasting tools all add up to a treasury function that cuts down substantially on their regular day-to-day work.
So, what does that just mean extra long lunch breaks and a two day week? Not exactly. All this freed up time gives treasurers the ability to focus on becoming true strategic partners to the business. Working closely with the CFO and finance function on scenario planning, forecasting, and strategic decision-making.
In 2025, we expect this trend to accelerate, and we’re not alone. According to HSBC, “The treasury function is well positioned to take on a more strategic role. Strengthening relationships with the C-suite and becoming a proactive business partner is key to unlocking broader organisational growth. By doing so, treasury leaders can extend their influence beyond their traditional finance universe.”
How Trovata Powers Treasury Success in 2025
At Trovata, we’re committed to empowering treasury teams to tackle 2025’s challenges head-on. Our platform combines real-time bank connectivity, AI-driven insights, and automated forecasting to simplify cash management and drive strategic decision-making.
Whether it’s optimizing liquidity in high-interest environments or ensuring compliance with an evolving regulatory landscape, Trovata provides the tools treasurers need to thrive in 2025 and beyond. Book a demo today to see how Trovata could transform your treasury operations.
